Price Fixing Allegations: South African Competition Commission Refers 8 Major Shipping Lines to Tribunal

Photo: Transnet / Phaata

In a significant legal move, the South African Competition Commission has officially referred a complaint regarding price-fixing against eight major shipping companies to the Competition Tribunal for prosecution.

It should be noted that this referral does not constitute a final finding of misconduct, and the shipping lines will have the opportunity to present their defense arguments before the Tribunal.

In a statement issued on Tuesday (Dec 2), the Commission said it had completed its investigation into allegations of collusion regarding the application of General Rate Increases (GRI) on certain shipping routes between South Africa, Asia, and West Africa.

The list of companies referred to the Tribunal includes some of the biggest names in the global shipping industry, specifically the South African branches of: Maersk, Mediterranean Shipping Company (MSC), CMA CGM, Pacific International Lines (PIL), Mitsui O.S.K Lines (MOL), Evergreen, COSCO Shipping Lines, and K Line.

In its statement, the Competition Commission said: "The respondents are global container shipping lines involved in shipping cargo for import and export purposes across the globe, including South Africa. They are alleged to have engaged in the fixing of the rates called general rate increase charged to customers for the shipment of general cargo enroute from South Africa to Asia and back, and from South Africa to West Africa and back."

According to the Commission, this alleged conduct constitutes price fixing, in contravention of section 4(1)(b)(i) of the Competition Act No. 89 of 1998.

The Commission also clarified the timeframe of the alleged violations: "The conduct is alleged to have started in 2008 and ceased in 2018."

The Commission's investigation found that the respondents charged the same GRI rates for routes from Shanghai, Ningbo, and Shenzhen (Shekou) to Durban; from Durban to Hong Kong; and from Qingdao to Durban.

Commissioner Doris Tshepe stated that the Commission believes stopping this alleged conduct will help lower prices for imported goods and reduce export costs, thereby improving South Africa's competitiveness in the global market.

Freight News contacted all eight shipping lines for comment but had not received a response at the time of publication.

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Source: Phaata.com (According to Freight News)

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